Didn't fix my wife's Kobo won't update but after I got the "NEW zip file"applied I made an image of a blank user then reinstalled all her apps contacts etc. Then made an image of that. I have used the Gdiskdump to make the images and reinstall them back to the internal card. One gives me a blank running March 02 system and the other gives me my wife's fully operational system. Won't get stuck with a dead tablet and unhappy wife again
It took a week to get this running again. Had to install an relearn Ubuntu Linux (installed by Kubuntu by mistake and had to switch desktops to get Gdiskdump installed and working.
When I installed your Kobo image it still did the install update stall at 40%.
So when I did my blank image I used a false Hotmail address and false Kobo account. It should get to an operating system that asks to update, which one could ignore!!!!
Linux seems to be the best way to handle Android.

Drunk monk when running gdiskdump. Work with zipped images only. To copy from your computer to your card. Select inputfile not disk drive get name of file .gz selected from your computer in gdiskdump select ---Forward select output now select disk drive--- Forward make sure to select your card in your card reader. Go it will take some time to copy to the card.
To make a back up just --- reverse--- input --your card as a drive to ---output ---your computer as a file named what you want will be a .gz
MANY THANKS to Pcampbell for the tip.

Batteraziiz
Gdiskdump handles files in Linux zipped format. This is a mirror copy of the whole system.
I assume you have a copy of pcampbell's Kobo file.
I am going to see if I can find some were to post my blank system file with Mar 02 update preinalled. originally from Sudbury Ontario. Retired out west.

Sorry folks, been busy at work. Working 7 days a week till April 9th (read as: "Ok, but I'm gonna set the building on fire")

To catch up here (themechaniac, nice job helping out!).

No you do NOT extract the image file. Yes you need Linux. From what I can tell problems are caused by improper/corrupted partition/file tables on the internal memory card.

All the vox's I've put it on so far are running perfectly now. I've tried same thing with the new updates, but with mixed results. Ok, 3:30am, I'm going to bed, will read replies better in morning.

PS: Linux is a VERY good operating system, I recommend everyone tries it. I know, takes a little learning, but once you get the basics you will fly with it. Basic rule of thumb: Windows for Games and Adobe Collections, Linux for Everything else.

Each time I set gdiskdump to work with the kobovox tar.gz file, I walk away and about 30-40% into the dump it crashes... Anyone else experiencing this? (I turned off the screensaver, made sure nothing was going idle after a period)

Alright, update and alternative solution for those non-linux individuals like myself and those having write access issues.

After getting the .img.gz file I tried, tried and tried again to install on existing SD card. What I found out is that my vox's 8gb card was not allowing write access no matter what I did. I tried everything I could think of and decided I'm done with the card! I bought a new card for $15 bucks and downloaded WinImage here.

If you don't want to use linux use this program. The steps to reflash are as follows:

1. First thing you will have to format and partition the new sd card using cmd prompt. Search youtube if you don't know how.

2. Extract the .img file from the .gz file.

3. Open WinImage. Under the "Disk" tab select "restore Virtual Hard Disk" . Then select your SD card and hit ok. In the popup select filetype in the bottom right and select "all files". Find and select your kobovox.img file. Select ok again to start.

4. Pop back sd card into your vox once re-imaging is complete and follow the setup. Good to go without using linux.

*As a note, it may just be that my cardreader wasn't accessing the microsd from the vox appropriately. This might happen to you. I'd suggest just buying a combo SD card/adapter that's 8gb and doing it my way. It's less than 20 bucks and it will save you the headache of trying to get the internal sd to write. Plus it will save you working in linux if you aren't very knowledgeable of it.

After 5 failed gdiskdump attempts (kept locking up at 53%), the winimage route worked Problem is, each time I try to update during the setup, now I'm getting the tablet upgrade error.
Update: Working!! I must have grabbed an old update.zip, had to grab the latest.

Sxpartax check drunkmonk's post above. Maybe you have a bad memory card, which would have caused your problem in the beginning.

Sxpartax do not extract gz file gdiskdump works on zips.

I am not a Linux guru and managed to copy the image to my stock Kobo card (so it was OK)
The gdiskdump program is not a command line program. In the menu just pick input --- file not disk (your source gz file) click forward and select output disk (make sure it is your SD card. Go, no formating required. You can do the exact opposite to backup your Kobo.
If this doesn't work I would go Drunk monks route --get a new card, maybe new card reader and adapter. Really desperate try the Windows program
My wife's Kobo Vox has been running perfectly since I reinstalled the image and made two different backups.
I can't get it away from her to do any experimenting